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Government shutdown to be averted - for now

U.S. President Barack Obama shakes hands with Speaker of the House John Boehner
President Barack Obama shakes hands with Speaker of the House John Boehner (R) after delivering his State of the Union speech on January 25, 2011 in Washington, DC. Getty

Updated 5:57 p.m. Eastern Time

Senate Democratic Leader Harry Reid said Tuesday that the Senate will accept a bill from the Republican-led House to fund the government for two additional weeks, likely averting the government shutdown that would otherwise have come Friday.

The House passed the short-term continuing resolution 335 to 91 on Tuesday afternoon, with six Republicans and 85 Democrats voting against it. (Two of those Republicans -- Michele Bachmann and Ron Paul -- are considering presidential runs.) According to Reid, it will move to the Senate for passage within the next two days. The White House has signaled that it will then be signed by President Obama.

Democrats and Republicans were able to work out a deal on the extension bill, which cuts four billion from the government, because the cuts came from areas where both parties agree. Yet the agreement ultimately represents a temporary reprieve, not a solution. The extension runs out on March 18th, a Friday - the new date for the start of a government shutdown if no further action is taken.

Nevada Senator Harry Reid
Senate Majority Leader Harry Reid AP Photo

Senate Democrats have expressed concern about the length of the extension, fearing that two weeks does not give them enough time to come to a longer-term agreement. They are also wary of getting into a situation in which they are forced to pass a series of two-week continuing resolutions, a condition that Democrats say creates economic uncertainty for businesses.

But House Republicans rejected an appeal from Mr. Obama to stretch the extension to a month, leaving Reid with little choice but to accept the two-week agreement or face a shutdown. He will now work to quickly craft a deal with House Republicans on a seven-month spending agreement to get through the rest of the fiscal year, which expires September 30.

It won't be easy: Democrats howled after the House passed a spending bill that cut more than $60 billion in federal spending, even as some Republicans in House Republican leader John Boehner's caucus complained the cuts did not go far enough. And there is not much room for agreement between the parties beyond the $4 billion in cuts in the extension bill.

"Stopgap measures like the one approved in the House today are only needed because the Democrats who run Washington failed to pass a budget last year and are now failing to listen to the American people who want to keep the government running while cutting spending," Boehner said in a statement following the vote.

The White House said Mr. Obama spoke to Boehner for about ten minutes on Tuesday to discuss progress on the negotiations. In a comment seemingly designed to pressure lawmakers to craft a longer-term agreement during the two-week window, White House press secretary Press Secretary Jay Carney said it would be harmful to the economy if "we created a tollbooth where we'd be negotiating again and again on continuing resolutions to fund the government for a few weeks or another short-term period."

House Speaker John Boehner. AP Photo

Boehner, meanwhile, said Tuesday that had the president initiated a conversation earlier than he did, there might have been a one-month extension that allowed an additional two weeks for negotiation. He also pointed to a report showing wasteful duplication in the governmentto argue there is plenty of fat yet to be cut.

For his part, Reid said the Obama administration "should be involved more" in the discussions - and predicted that it will be. He said the president is "going to become more engaged. He's indicated he will and I know he will. He has the bully pulpit in the White House which is very important."

Carney, the White House press secretary, said Tuesday that there is "no debate here about the need to cut spending."

"The question is where do you cut in a way that doesn't harm the economy, doesn't throw it in reverse, doesn't reduce job growth, job creation, and that protects the investments that are so key to longer term economic growth in this country."

The $4.1 billion in cuts in the extension bill includes $1.24 billion in cuts to eight programs that Mr. Obama targeted for termination in his 2012 budget. Those programs include $650 million in highway funding and $468 million in education funding among other measures. The remaining $2.7 billion is from cutting 2010 earmark funding.